Article from last December
http://www.chicagotribune.com/news/opinion/editorials/ct-obamacare-congress-budget-edit-1227-jm-20151223-story.html
Congress just kicked the financial legs out from under Obamacare.
In a spending bill passed this month, lawmakers delayed three key taxes designed to help pay the entitlement program's costs, and clamped down on a bailout of struggling health insurers.
As a result, the long-term financial prognosis of Obamacare looks shakier than it did before. That ups the ante on Republicans to deliver their promised, but as yet unwitnessed, rehab or replacement for the Affordable Care Act. Ladies and gentlemen, several million Americans who've come to rely on Obamacare deserve to know what coverage plans you envision for them.
Democrats, you're also invited to reshape federal regulation of health care. By expanding insurance but also dictating expansive coverage, your party created the costs of Obamacare. But without the revenue streams you anticipated, paying for all of those costs just got dicier. You, too, want a truly affordable care act.
How the game just changed:
•The so-called Cadillac tax was supposed to tame health costs by taxing lavish health care plans enjoyed by millions of Americans, notably clout-heavy union members. That tax was supposed to start in 2018 but now won't kick in until 2020 unless Congress, as we expect, delays it again. If so, that's $91 billion in lost revenue from 2018 to 2025.
•A tax on insurers that sell to individuals, families and many businesses was expected to yield $142 billion over a decade. That tax has been in effect since 2014 but is suspended for 2017, costing the U.S. Treasury $12 billion.
Obamacare has a fever coming on
Obamacare has a fever coming on
•A medical devices tax that harms American companies' competitiveness is nixed for 2016 and 2017. Cost: $4 billion.
•Congress also held firm for the second year on the so-called risk corridor law that was designed to help struggling insurers survive the first few years of Obamacare. The idea was that successful Obamacare insurers would pay into a fund to help those that calculated wrong when they set rates in the fledgling years and lost money. But guess what? About 2 of every 3 health care payers lost money in 2014; many of the rest eked out small profits. Insurers asked for $2.9 billion in payments from the risk corridor fund to cover 2014 expenses, but there was only $362 million in the pot. A little-noticed provision, often credited to Sen. Marco Rubio, R-Fla., prevented the Obama administration from raiding other funds to pay off the struggling insurers. The insurers had to survive (or not) on their own, without a government bailout. Many state insurance co-ops, created to stoke competition among insurers, capsized. Other insurers may follow.
Obamacare: Don't ditch the Cadillac tax
Obamacare: Don't ditch the Cadillac tax
These changes undercut key selling points of Obamacare: the promises that it would bend the cost curve on health care and cut federal deficits. If these taxes end up permanently repealed, or suspended year after year — a reasonable guess — then the result will be that instead of generating a $137 billion reduction in the nation's deficits in the decade from 2016 to 2025, Obamacare would actually add $120 billion to the debt, Loren Adler, research director at the Committee for a Responsible Federal Budget, tells us. "It's a little frightening to see people agree to undermine cost controls in the law," he says.
Remember, Obamacare is an entitlement brought to you entirely by Democrats. No Republicans voted for it. By contrast, 166 Democrats just joined 150 Republicans in the House to pass the spending measure that dams the Obamacare revenue streams; similarly in the Senate, 38 Democrats and 27 Republicans voted to strip out the Obamacare taxes.
The Obamacare predictions that President Barack Obama and his party made are fraying. And Democrats themselves are helping unravel the fiscal underpinnings of the law. Worse, as the driving force for suspending the Cadillac tax, the Democrats remove incentives for businesses and others to rein in health costs.
This is not Armageddon for Obamacare. Open enrollment recently ended for policies that start Jan. 1. Health and Human Services Secretary Sylvia Burwell reported "record demand" for that coverage.
People still want insurance, especially if it is reasonably priced and offers a wide network of doctors and hospitals. But Obamacare is faltering on both of those promises, along with those pledges to tame health costs and cut deficits.
House Speaker Paul Ryan, R-Wis., said earlier this month that in 2016 Republicans will unveil a plan to replace Obamacare. He said that even if Obama wouldn't sign such a law — and he wouldn't — Republicans in Congress must produce proposals to show voters "what our ideal policy would be looking forward to 2017 and beyond."
Yes, let's see the Republican plan. And let's hope it impresses Americans with sensible coverage, incentives and costs.
Because the next president and Congress have no choice but to fix Obamacare, a law now known for rocketing premiums, narrowing networks of coverage, flummoxed consumers and insolvent insurers.